Introduction and executive summary

The federal minimum wage was established in 1938, as part of the Fair Labor Standards Act (FLSA), to help ensure that all work would be fairly rewarded and that regular employment would provide a decent quality of life. In theory, Congress makes periodic amendments to the FLSA, increasing the federal minimum wage so that even the lowest-paid jobs in the economy still pay enough for workers to meet their needs, and helping ensure that low-wage workers benefit from economywide improvements in productivity, wages, and living standards.

Yet since the late 1960s, lawmakers have let the value of the minimum wage erode, allowing inflation to gradually reduce the buying power of a minimum wage income. When the minimum wage has been raised, the increases have been too small to counter the decline in value that has occurred since 1968, when the minimum wage hit its peak in inflation-adjusted terms. In 2018, the federal minimum wage of $7.25 was worth 14.8 percent less than when it was last raised in 2009, after adjusting for inflation, and 28.6 percent below its peak value in 1968, when the minimum wage was the equivalent of $10.15 in 2018 dollars.

This decline in purchasing power means low-wage workers have to work longer hours now just to achieve the standard of living that was considered the bare minimum half a century ago. Since the 1960s, the United States has achieved tremendous improvements in labor productivity that could have allowed workers at all pay levels to enjoy a significantly improved quality of life (Bivens et al. 2014). Instead, because of policymakers’ failure to preserve this basic labor standard, a parent who is the sole breadwinner for her family and who is earning the minimum wage today does not earn enough through full-time work to bring her family above the federal poverty line.

Restoring the value of the minimum wage to at least the same level it was at a generation ago should be uncontroversial. But such a raise would be insufficient. The technological progress and productivity improvements that the country has achieved over the last 50 years have not benefited all of America’s workers. This means lawmakers must strive to enact minimum wage increases that are bolder than the typical legislated increases in recent decades.

On January 16, 2019, Sen. Bernie Sanders (I-Vt.) and Rep. Bobby Scott (D-Va.) announced that they would introduce the Raise the Wage Act of 2019, a bill that would raise the federal minimum wage in six steps to $15 per hour by 2024. Beginning in 2025, the minimum wage would be “indexed” to median wages so that each year, the minimum wage would automatically be adjusted based on growth in the median wage. The bill would also gradually increase the subminimum wage for tipped workers (or “tipped minimum wage”), which has been fixed at $2.13 per hour since 1991, until it reaches parity with the regular minimum wage.1

Who would benefit if the federal minimum wage is raised to $15 by 2024?

A total of 39.7 million workers would benefit, including:

38.6 million adults ages 18 and older

23.8 million full-time workers

23.0 million women

11.2 million parents

5.4 million single parents

The parents of 14.4 million children

This report begins by providing historical context for the current value of the federal minimum wage and the proposed increase to $15 by 2024. It then describes the population of workers likely to receive higher pay under an increase to $15 by 2024, with detailed demographic data that refute a number of common misconceptions about low-wage workers. Next, it describes the provisions of the Raise the Wage Act that would index the minimum wage to the median wage, and gradually eliminate the subminimum wage for tipped workers. The report concludes with a discussion of the research on the likely effects such a raise would have on businesses, employment, and low-wage workers’ welfare.

This report finds that:

Raising the minimum wage to $15 by 2024 would undo the erosion of the value of the real minimum wage that began primarily in the 1980s. In fact, by 2021, for the first time in over 50 years, the federal minimum wage would exceed its historical inflation-adjusted high point, set in 1968.

Gradually raising the minimum wage to $15 by 2024 would directly lift the wages of 28.1 million workers. The average directly affected worker who works all year would receive a $3,900 increase in annual wage income—equal to a raise of 20.9 percent. Another 11.6 million workers would benefit from a spillover effect as employers raise wages of workers making more than $15 in order to attract and retain employees.

All told, raising the minimum wage to $15 by 2024 would directly or indirectly lift wages for 39.7 million workers, 26.6 percent of the wage-earning workforce.

Over the phase-in period of the increases, the rising wage floor would generate $118 billion in additional wages, which would ripple out to the families of these workers and their communities. Because lower-paid workers spend much of their extra earnings, this injection of wages would help stimulate the economy and spur greater business activity and job growth.

The workers who would receive a pay increase are overwhelmingly adult workers, most of whom work full time in regular jobs, often to support a family.

The average age of affected workers is 35 years old. A larger share of workers ages 55 and older would receive a raise (14.6 percent) than teens (9.3 percent). More than half of all affected workers are prime-age workers between the ages of 25 and 54.

Although men make up a larger share of the overall U.S. workforce, the majority of workers who would be affected by a raise to the minimum wage (57.9 percent) are women.

The minimum wage increase would disproportionately raise wages for people of color—for example, black workers make up 11.8 percent of the workforce but 16.9 percent of affected workers. This disproportionate impact means large shares of black and Hispanic workers would be affected: 38.1 percent of black workers and 33.4 percent of Hispanic workers would get a raise.

Of workers who would receive a raise, 60.0 percent work full time, 44.0 percent have some college experience, and more than a quarter (28.3 percent) have children.

Nearly four out of every 10 single parents who work (38.9 percent) would receive higher pay, including 43.0 percent of working single mothers. In all, 5.4 million single parents would benefit, accounting for 13.5 percent of those who would be affected by raising the minimum wage to $15 by 2024.

The workers with families who would benefit are typically the primary breadwinner for their family, earning an average of 51.9 percent of their family’s total income.

The Raise the Wage Act would disproportionately help those in poverty or close to it. Two-thirds (67.3 percent) of the working poor in America would receive a pay increase if the minimum wage were raised to $15 by 2024.

A federal minimum wage increase to $15 in 2024 would raise wages for the parents of 14.4 million children across the United States, nearly one-fifth (19.6) percent of all U.S. children.

Indexing the minimum wage to the median wage would ensure that low-wage workers share in broad improvements in U.S. living standards and would prevent future growth in inequality between low- and middle-wage workers.

Data by state and congressional district

Supplemental tables showing characteristics of workers who would be affected by increasing the federal minimum wage to $15 by 2024 in each of the states and in the District of Columbia are available here.

In addition, data by congressional district is viewable in an interactive map (EPI 2019b).

The minimum wage in context

Since its inception in 1938, the federal minimum wage has been adjusted through legislated increases nine times—from a nominal (non-inflation-adjusted) value of 25 cents per hour in 1938 to the current $7.25, where it has remained since 2009. These increases have been fairly irregular, varying in size and with differing lengths of time between increases. Yet aside from a few very brief deflationary periods in the post–World War II era, prices have consistently risen year after year. Each year that the minimum wage remains unchanged, its purchasing power slowly erodes until policymakers enact an increase. This haphazard maintenance of the wage floor has meant that low-wage workers of different generations or in different decades have been protected by significantly different wage standards.

Figure A shows the nominal and inflation-adjusted (real) value of the minimum wage since 1938, as well as the value of the minimum wage had it increased at the rate of productivity (specifically, it shows U.S. total economy net productivity indexed to the 1968 inflation-adjusted value of the minimum wage). As the figure shows, in 1950—the first year the minimum wage was increased after the end of World War II—the minimum wage rose rather dramatically in real terms, nearly doubling overnight. The 1950 increase was followed by regular increases that roughly kept pace with rising labor productivity until the late 1960s. The minimum wage peaked in inflation-adjusted value in 1968, when it was equal to $10.15 in 2018 dollars. Increases in the 1970s essentially held the real value of the minimum wage in place as high levels of inflation—driven by oil and food price shocks—effectively negated the nominal increases that were enacted at that time. In the 1980s, as inflation remained elevated, the minimum wage was left to deteriorate to 1950s levels. Subsequent increases in the 1990s and late 2000s were not large enough to undo the erosion that had taken place in the 1980s. As of 2018, the federal minimum wage was worth 28.6 percent less than in 1968.2

Figure A

Neglect has left the minimum wage far below what the economy could afford: Real and nominal values of the federal minimum wage, and value if it had risen with total economy productivity, 1938–2018, and projected values under the Raise the Wage Act of 2019, 2019–2024

Notes: Inflation measured using the CPI-U-RS. Productivity is measured as total economy productivity net depreciation.

Sources: EPI analysis of the Fair Labor Standards Act and amendments and the Raise the Wage Act of 2019. Total economy productivity data from the Bureau of Labor Statistics Labor Productivity and Costs program. Average hourly wages of production nonsupervisory workers from the Bureau of Labor Statistics Current Employment Statistics.

The dashed lines in the figure—representing projected values for the years 2019–2024—show that the Raise the Wage Act would reverse this unfortunate trend for low-wage workers. A series of six increases over six years—beginning with an increase to $8.55 in 2019 and ending at $15 in 2024—would for the first time ever lift the purchasing power of the federal minimum wage above its 1968 peak. In real terms (that is, in 2018 dollars), the minimum wage would reach an estimated value of $10.37 in 2020 and $12.98 in 2024. The full increase to $15 by 2024 represents a 79.0 percent real increase in the minimum wage over its current value, and a 27.9 percent increase in purchasing power from the 1968 peak.3

Such an increase would be the largest raise in the federal minimum wage since 1950, when it was lifted by an inflation-adjusted 85 percent in one year. As such, this increase would be larger than what has been typical in recent decades; however, policymakers will have to enact bolder increases than in the recent past if they intend for low-wage workers to ever fully share in the growth of productivity and the economy that has occurred over the past five decades. As explained by Cooper, Schmitt, and Mishel (2015), increases in average labor productivity represent the potential for higher living standards for workers. In simple terms, if workers, on average, are producing more from each hour worked, there is room in the economy for all workers to get a commensurate raise in wages. This would represent all workers getting a share of economic growth. However, this potential is realized only if productivity gains translate into higher wages. The top line in the figure, which represents the inflation-adjusted value of the minimum wage had it aligned with productivity growth, shows that average labor productivity has more than doubled since the late 1960s. Despite this growth in the country’s ability to produce income, pay for workers generally and for low-wage workers in particular has either stagnated or fallen since the 1970s (Bivens et al. 2014). In the case of low-wage workers, hourly pay has declined in real terms since 1979 as a direct result of the erosion of the minimum wage (Bivens et al. 2014).

A higher minimum wage would direct a portion of overall labor productivity gains into higher living standards for low-wage workers. It is not known precisely how much productivity in low-wage work has grown since the 1960s relative to overall productivity. However, low-wage workers today tend to be older (and are therefore likelier to have greater work experience) and are significantly more educated than their counterparts in 1968 (Mishel 2014a). To the extent that workers with more experience and greater education typically earn more than their younger and less-educated counterparts, we would expect low-wage workers today to earn more, not less, than what they earned in the previous generation. In this context, a pay increase for America’s lowest-paid workers of 28 percent over the 56-year span from 1968 to 2024 is indeed modest when compared with projected overall productivity growth of 119 percent over the same period.4

The minimum wage is also a mechanism for combating inequality and helping to keep a middle-class lifestyle within reach for all workers. As increased productivity has translated into higher wages for high-wage workers, a rising minimum wage ensures that the lowest-paid jobs also benefit from these improvements. This is the essence of the “fairness” implied in the name of the Fair Labor Standards Act, the act that established the minimum wage.

Figure B shows how the federal minimum wage has compared with the wages of typical U.S. workers over time. The top line shows the median wage of full-time, full-year workers since 1968, adjusted for inflation to constant 2018 dollars. (The dashed line shows projections for 2019–2024.) The bottom line shows the inflation-adjusted value of the federal minimum wage. (The dashed line shows projections for 2019–2024 under the Raise the Wage Act.) In 1968, the median worker in the United States earned $19.23 per hour—roughly $9 more per hour than a minimum wage worker at that time. Since then, the gap between the typical U.S. worker and the lowest-paid worker has grown substantially—to more than $15 per hour as of 2018. The median wage has grown only modestly over the past 50 years—roughly 16 percent—yet the large decline in the value of the minimum wage has left workers at the bottom of the wage scale farther from the middle class than they have been in half a century. Indeed, the declining value of the federal minimum wage is the key driver of the growth in inequality between low-wage workers and middle-wage workers since the late 1970s (see Zipperer 2015a and Mishel 2014b).

Figure B

The gap between the minimum wage and the median wage has grown substantially—the Raise the Wage Act would narrow the gap: Real values of the federal minimum wage and the full-time, full-year median wage, 1968–2018; projected values for 2019–2024 under the Raise the Wage Act; and dollar amount of the gap between the minimum and the median, selected years (2018$)

Notes: Inflation measured using the CPI-U-RS. The 2018 full-time, full-year median wage is estimated by growing the 2017 full-time, full-year median wage at the growth rate of average hourly earnings of production workers from 2017 to 2018. This value is then projected at the growth rate of CPI plus 0.5 percent.

Source: EPI analysis of the Fair Labor Standards Act and amendments, the Raise the Wage Act of 2019, and the Current Population Survey (CPS) Annual Social and Economic Supplement microdata

The vertical dotted lines in the graph illustrate the gap between the median and minimum wages at different points in time—and show how the Raise the Wage Act would shrink this gap, reducing it to about $1 dollar more than the difference that existed in 1968. Assuming modest annual real wage growth of 0.5 percent for workers at the median over the next six years, a minimum wage of $15 in 2024 (which corresponds to $12.98 in 2018 dollars) would lift the wage floor to just over $10 less than the wages of a typical U.S. worker—far closer to the gap that existed in the late 1960s.

Figure C presents these same data in a different way. The solid line shows the value of the federal minimum wage as a percentage of the median wage of all full-time, full-year workers. Once again, the gradual decline of the line illustrates how inadequate increases in the federal minimum wage have gradually increased the gap between the lowest-paid workers and those in the middle of the wage distribution. In 1968, the federal minimum wage was equal to just over half the wage of the typical U.S. worker: 52.8 percent of the median wage of all full-time workers. In 2018, the minimum wage is projected to be less than one-third of the wage of the typical worker: 32.4 percent of the median wage of all full-time, full-year workers.

Figure C

The Raise the Wage Act would eliminate decades of growing wage inequality between the lowest-paid and the typical U.S. worker: Federal minimum wage as a share of the national full-time, full-year median wage, 1968–2018 (actual) and 2019–2024 (projected under the Raise the Wage Act of 2019 for two scenarios)

The dashed lines in Figure C project the ratios for 2019–2024 under the Raise the Wage Act. These projections show that the Raise the Wage Act would reverse this growth in inequality and place the minimum wage as a share of the the median wage above its historical high point. Projections are shown for 2019–2024 under two scenarios: one in which nominal median wages rise at the rate of projected inflation, so that there is no real wage growth, and one in which median wages grow 0.5 percent per year faster than projected inflation from 2018 to 2024, as was assumed in Figure B.5 The Raise the Wage Act would lift the minimum wage’s share of the full-time, full-year median wage to 58.0 percent if there is no real wage growth or to 56.4 percent if there is modest real wage growth. Of course, if wages for middle-wage workers grow faster than 0.5 percent above inflation, this percentage will be smaller.

When set at an adequate level, the minimum wage also helps ensure that work is a means to a decent quality of life. In fact, the explicit purpose of the FLSA is to correct “labor conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers.”6 The federal poverty line is often cited as a proxy for the level of income needed for the general well-being of families. Researchers and policymakers have long acknowledged that, in reality, the poverty line is woefully inadequate as a measure of what is truly needed for a family to afford the basic necessities.7 Yet even against this low bar, the federal minimum wage has rarely produced enough income for regular full-time workers, particularly those with children, to meet their needs.

As shown in Figure D, a parent working full time while earning the minimum wage today earns too little to bring his family—even if it is just a family of two—above the federal poverty line. In contrast, at its high point in 1968, the minimum wage was sufficient to keep a family of three out of poverty, but not a family of four. As the ascending dashed line in the figure shows, the Raise the Wage Act would, for the first time ever, bring full-time minimum wage earnings above the poverty line for a family of four.

Figure D

At $15 in 2024, the federal minimum wage would no longer be a poverty wage: Annual wage income (2018$) for a full-time, full-year minimum wage worker, compared with various poverty thresholds, 1964–2018 (actual) and 2019–2024 (projected under the Raise the Wage Act of 2019)

Demographic characteristics of affected workers

Raising the federal minimum wage to $15 by 2024 would lift pay for more than one-fourth of American workers. The vast majority of workers who typically benefit from minimum wage increases do not fit the common portrayal of low-wage workers primarily as teenagers from middle-class families, who are working part time after school, or as “stay-at-home” parents—parents whose primary job is caring for their own children—who are picking up some work on the side and whose “secondary earnings” are inconsequential to their family’s financial health.8 As the subsequent sections show, increasing the minimum wage to $15 by 2024 would raise wages for millions of prime-age, full-time workers, many of whom are the primary breadwinners for their families. Detailed demographic information on the affected workforce—including statistics on women, black, Hispanic, Asian, white, and Native American workers—can be found in Appendix Tables 6–12.

Figure E shows the number of workers who are likely to receive a raise as the minimum wage is gradually increased.

Figure E

The Raise the Wage Act would lift pay for more than a quarter of all U.S. workers: Number of workers (in millions) who would benefit if the federal minimum wage were increased to $15 by 2024

In the first step, when the minimum is increased from $7.25 to $8.55 per hour, 7.6 million workers are likely to benefit. This includes 2.9 million workers who will directly benefit—meaning their current pay rate is between $7.25 and $8.55—as well as 4.7 million who will indirectly benefit, meaning they will likely receive a raise through spillover or “ripple” effects because their current pay rate is just above $8.55.9 Raising the minimum wage typically results in wage increases for workers further up the wage ladder because employers want to maintain some progression in their internal pay scales (Wicks-Lim 2006).

With each successive increase, the number of workers who would benefit grows: At each step, all those workers whose wages were raised in the previous step receive another raise, and additional workers whose wages were “too high” to benefit from previous step increases now benefit as well. In the second year, as the minimum wage is lifted to $9.85 per hour, the number of workers who would directly receive a raise grows to 7.3 million; another 8.3 million would indirectly receive a raise. When the minimum wage increases to $11.15 in year three, 14.0 million would be directly affected, along with 7.5 million who would be indirectly affected. In the fourth year, 2022, the increase to $12.45 per hour would raise wages directly for 18.4 million workers and indirectly for another 8.6 million workers. The increase to $13.75 per hour in year five would directly lift the pay of 22.1 million workers and indirectly spur wage increases for another 11.8 million workers. In the final year, when the minimum wage is raised to $15 per hour, 28.1 million workers would directly benefit and an additional 11.6 million would likely receive a raise indirectly as employers adjust overall pay ladders. In total, the increase to $15 would lift wages for 39.7 million workers—26.6 percent of all U.S. workers. Detailed figures on the workers affected and resulting wage increases in each step can be found in Appendix Tables 1 and 2.

This minimum wage increase would be larger than any other increase that has been enacted in the United States. In addition to the larger breadth of affected workers, the potential increase in wages for those workers would be larger than any previous increase. Over the full six-year phase-in period, affected workers would receive approximately $118 billion in additional annual wages, assuming no change in the number of work hours for these workers.10 Once the increase is fully phased in, the average affected worker who works year-round would earn roughly $3,000 more each year than she does today. Among only those workers who directly benefit, the average year-round worker would get a boost to his or her annual earnings of about $3,900.

The following sections highlight the demographic characteristics—age, sex, race/ethnicity, family composition, hours of work, education, family income, poverty status, and geography—of the workers who would be affected. We count as “affected” both those directly and indirectly affected. The calculations are estimates for 2024. Tables containing all the underlying demographic information, including discrete numbers of affected workers by demographic category, are presented in Appendix A.

Age

The low-wage workers likely to benefit from an increase to the minimum wage are frequently characterized as being primarily teenagers and almost entirely young. Although this would not justify paying them wages significantly lower than those paid to their counterparts a generation ago, this stereotype is also false—and particularly so for beneficiaries of a minimum wage increase to $15. While some low-wage workers are indeed young, the vast majority of workers who would benefit from increasing the federal minimum wage to $15 are adults age 20 or older; only a small fraction are teenagers. As shown in the top graph in Figure F, teens account for a mere 9.3 percent of the workers who would benefit; over 90 percent of affected workers are 20 years old or older.

Figure F

The vast majority of workers who would benefit from an increase to the minimum wage are not teens—most are 25 or older

Projected share of workers benefiting from an increase to $15 by 2024 who are 19 or under versus 20 or older

The second graph in Figure F breaks down the age distribution of affected workers even further, showing that more than two-thirds of affected workers are at least 25 years old. In fact, workers ages 55 and older make up a larger share of workers who would receive a raise (14.6 percent) than do teens (9.3 percent), and workers ages 40 and older make up a larger share of those who would receive an increase (33.9 percent) than do workers under age 25 (32.5 percent). Among affected workers, the average age is 35 years old.11

Gender

While raising the minimum wage would benefit both women and men, it would disproportionately raise pay for women. As shown in the pie chart in Figure G, women make up 57.9 percent of affected workers. In comparison, women make up only 48.5 percent of the total U.S. workforce.12

Figure G

Women make up a majority of workers who would benefit from a minimum wage increase to $15 by 2024; single parents and women of color would also benefit disproportionately

The magnitude of the impact on women is shown in the bar chart in Figure G. Among all wage-earning women in the United States, 31.7 percent—nearly one in three working women—would receive a raise under a federal minimum wage increase to $15 by 2024. In comparison, 21.7 percent of all wage-earning men would benefit—not as large a share as for women, but still more than one-fifth of all working men.

The bar chart in Figure G also shows, by gender, the shares of workers who would benefit from a minimum wage increase by family status and for workers of color. Among working parents with children in their home, 30.2 percent of working mothers would receive a raise, as would 13.4 percent of working fathers. Among single parents, the effects are more dramatic: 43.0 percent of all single mothers would receive a raise if the federal minimum wage were increased to $15 by 2024, as would nearly a third (29.4 percent) of single fathers. Large shares of minority workers would also benefit: 35.6 percent of women of color would receive a raise, along with 27.9 percent of men of color.

Race/ethnicity

As shown in the upper section of Figure H, the majority—52.2 percent—of workers who would benefit from increasing the minimum wage are white, non-Hispanic workers. Hispanic workers of any race make up the next largest share, at just under a quarter (24.2 percent) of the total affected population. Black workers make up 16.9 percent of the total, and Asian workers and workers of other races/ethnicities make up 6.8 percent of the total.

Figure H

White workers make up a majority of those who would benefit from the Raise the Wage Act, although workers of color would benefit disproportionately

Although workers of color are a minority of those who would benefit, they do benefit at significantly higher rates. The lower section of Figure H shows the share of each racial/ethnic group that would receive a raise if the federal minimum wage were increased to $15 by 2024. As the figure shows, 38.1 percent of all black workers would receive higher pay, as would a third (33.4 percent) of Hispanic workers. Nearly one in four (23.2 percent of) white, non-Hispanic workers would get a raise—a slightly higher share than that of Asian workers and those of other races/ethnicities, among whom 19.6 percent would receive higher pay.

Education

Just as there is a common misperception that low-wage workers are mostly young, there is also a common misperception that low-wage workers have low education levels. The reality is that, as shown in Figure I, close to half (44.0 percent) of workers who would be affected by an increase to the minimum wage have at least some college experience, and about one in seven (13.8 percent) have an associate degree or higher.

Figure I

Among those workers who would benefit from a minimum wage increase to $15 by 2024, four in 10 have some college experience

Share of affected workers who are in each educational attainment group

The lower bar graph in Figure I shows the share of workers at each educational level who would receive a raise if the federal minimum wage were increased to $15 by 2024. Not surprisingly, workers with lower levels of education are far more likely to be affected: More than half (51.1 percent) of workers with less than a high school education would receive a pay increase. Still, large shares of those who have completed high school and sought further education would also benefit. More than a third (34.4 percent) of workers with some college experience, yet no degree, would receive a raise, as would more than one-fifth (21.5 percent) of workers with an associate degree.

Hours of work

Many workers who would benefit from a minimum wage increase also work longer hours than commonly thought; they are not simply working part-time or after-school jobs. As shown in the upper section of Figure J, 60.0 percent of affected workers work full time (at least 35 hours per week). Another 29.5 percent work between 20 and 34 hours per week, and only 10.5 percent work fewer than 20 hours per week.

Figure J

Among those workers who would benefit from a minimum wage increase to $15 by 2024, most work full time

Still, those workers who are not full time are more likely to benefit. The lower bar chart in Figure J shows the share of each group of workers by work-hour category who would receive a raise if the minimum wage were increased to $15. Roughly half (48.4 percent) of workers who work fewer than 20 hours per week would receive a raise, as would 52.8 percent of those working between 20 and 34 hours per week. Among full-time workers, one in five (20.1 percent) would receive a raise.

Many individuals who work less than full time are not opting for fewer hours by choice, but are limited by a lack of available work, or because circumstances—such as the need to care for a family member, or a lack of adequate work supports (access to child care, paid leave, or flexible work schedules)—prevent them from seeking full-time employment (Golden 2016). For these workers, an increase in their hourly rate of pay is arguably even more important, not only because of the increased earnings but also because those increased earnings could provide the resources needed (e.g., money for child care) to allow them to seek more hours of work.

Family income

Again contrary to some portrayals, the majority of workers who would benefit from increasing the minimum wage come from families of modest means. That being the case, these workers’ wages are likely to constitute an essential contribution to their household’s welfare—rather than simply being “extra” income supplementing a much higher paycheck from a spouse or parents. As shown in Figure K, 76.0 percent of the workers who would receive a raise if the minimum wage were increased to $15 by 2024 have total family incomes of less than $75,000 per year. More than half of affected workers (59.5 percent) have total family incomes below $50,000 per year.

Figure K

Among those workers who would benefit from a minimum wage increase to $15 by 2024, most come from families with modest incomes: Share of affected workers who are in each family income group

Some argue that the minimum wage is “poorly targeted” as a tool for alleviating poverty or improving low-income households’ welfare because some of the workers who would benefit from a minimum wage increase come from middle-class families. It is false that raising the minimum wage does not reduce poverty—as is explained in the next section—but assessing only the minimum wage’s poverty-reducing effects also disregards an important aspect of the policy. The minimum wage provides protection to workers at all levels of family income—this is a feature, not a bug, of the law. As a labor standard, the minimum wage prevents exploitation of workers, regardless of their family income level. No worker, no matter how wealthy his or her family, should have to work for unacceptably low wages. Moreover, the fact that some low-wage workers do come from middle-class families underscores the point that the erosion in the minimum wage’s value over the past 45 years has hurt both low- and middle-income families.

Poverty status

Some opponents of raising the minimum wage contend that as a policy for reducing economic hardship, the minimum wage is ineffective because many poor people do not work. This is false. As explained in Gould, Davis, and Kimball 2015, the majority of poor people ages 18 to 64 who can work (i.e., they are not in school, retired, or disabled) do work, and over 40 percent work full time. Moreover, increasing the minimum wage is an effective tool for reducing poverty. In a comprehensive review of the literature on the minimum wage’s poverty-reducing effects, Dube (2018) finds that nearly all studies of this relationship show that raising the minimum wage significantly reduces poverty rates. Dube’s study also finds that for every 10 percent increase in the minimum wage, over the long run, the poverty rate is expected to decline by 5.3 percent.

Our findings show that the Raise the Wage Act would disproportionately help workers in poverty or near the poverty line. As shown in the top portion of Figure L, nearly half (46.7 percent) of all workers who would be affected by raising the minimum wage to $15 by 2024 have total family incomes within 200 percent of the poverty line. Another 33.1 percent have family incomes between 201 and 400 percent of the poverty line.

Figure L

The Raise the Wage Act would disproportionately help workers in poverty

Indeed, workers living below or near the poverty line are far more likely than higher-income workers to get a pay increase if the minimum wage is raised. The bar chart in the bottom section of Figure L shows that two-thirds (67.3 percent) of all the working poor would receive higher wages as a result of the Raise the Wage Act. More than half (53.6 percent) of those who are “near poor,” with incomes between 101 and 200 percent of the poverty line, would also receive a raise.

Family status and children

Many of the workers who would benefit from increasing the minimum wage are supporting families and children. As shown in the upper section of Figure M, nearly one-third (30.8 percent) of the affected workers are married, and more than one-quarter (28.3 percent) of affected workers have children. In total, over 11.2 million parents would receive higher pay under a minimum wage increase to $15 by 2024. Of these, 5.4 million are single parents, accounting for 13.5 percent of those who would be affected by raising the minimum wage. While this is a relatively small portion of the total beneficiaries, it is larger than their 9.2 percent share of the overall labor force. In other words, single parents would disproportionately benefit from raising the minimum wage.

Figure M

Among those workers who would benefit from a minimum wage increase to $15 by 2024, many have families; single parents would disproportionately benefit

The lower bar chart in Figure M shows the shares of workers by family type who would be affected. Among married parents who work, 15.6 percent would receive a raise from increasing the minimum wage to $15 by 2024. Single parents who work would benefit at more than double that rate—38.9 percent would receive higher pay if the minimum wage were raised.

The parents receiving higher pay provide for 14.4 million children across the United States, nearly one-fifth (19.6 percent) of all U.S. children (see Appendix Table 4). It is also worth noting that many children are raised by an adult who is not their biological or adoptive parent; these households are not accounted for in these numbers. Thus, the full benefit to children of a $15 minimum wage is arguably better captured by looking at the impacts for all children with at least one adult in their household who receives a raise—regardless of whether that person is their biological or adoptive parent. There are a total of 17.0 million children (23.2 percent of all U.S. children) with at least one adult in their household—e.g., a parent, grandparent, caretaker, or adult sibling—who will benefit from raising the federal minimum wage to $15 by 2024.

The importance of affected workers’ pay to their family’s total incomes

Low-wage workers are sometimes characterized as “secondary earners,” suggesting that their work earnings are discretionary or inconsequential to their family’s financial health. The data show that this is not at all the case. Roughly half of all workers who would be affected by raising the minimum wage to $15 by 2024 are either married or have children, and these workers earn, on average, 51.9 percent of their family’s total income. Of these workers with families, 32.2 percent are the sole providers of their family’s income.13

Geography

Not surprisingly, the share of workers in each state who would be affected by a federal minimum wage increase varies considerably, largely due to the fact that many states, and a growing number of cities and counties, have already enacted minimum wage increases that will have lifted a sizeable share of their state or local workforces out of the affected range.14 As the increases in those states’ and localities’ minimum wages “ripple up” through the wage distribution, the number of workers who would be affected by the enactment of a higher federal minimum by 2024 is reduced.

Figure N shows the share of each state’s resident workforce that would be affected if the federal minimum wage were raised to $15 by 2024. Because California and Massachusetts will already have state minimum wages of $15 in 2023, very few California or Massachusetts workers would be affected by the change in the federal minimum wage—although a small number who commute to out-of-state jobs would be impacted. The District of Columbia is raising its minimum wage to $15 in 2020 and so few workers in the district would benefit from the new federal minimum. However, a relatively small number of workers in both D.C. and Massachusetts—those who customarily receives tips as a portion of their wages—will benefit from the Raise the Wage Act’s increase in the minimum wage for tipped workers. Tipped workers in California are already paid the full minimum wage before tips, so they will not be affected by the federal policy change. New York is raising the minimum wage in New York City, Long Island, and Westchester County to $15 before 2024, but not in the upstate region of the state; upstate workers would therefore still be affected by the federal change (as would tipped workers throughout the state). In total, 12.5 percent of New York workers would receive a raise as a result of the rising federal minimum wage and tipped minimum wage.

Figure N

Workers across the country would get a pay hike from the Raise the Wage Act: Share of workforce in each state that would be affected if the federal minimum wage is raised to $15 by 2024

Note: The map is colored based on the share of the state workforce that would be affected.

The map is colored based on the share of the state workforce that would be affected. Values reflect the result of the proposed change in the federal minimum wage. Wage changes resulting from scheduled state minimum wage laws are accounted for in the simulation. Totals may not sum due to rounding. Shares calculated from unrounded values. Total estimated workers is estimated from the CPS respondents who were 16 years old or older, employed, but not self-employed, and for whom a valid hourly wage is either reported or can be determined from weekly earnings and usual weekly hours.

Among states that will not already have a $15 minimum wage by 2024, the smallest impacts would be in Washington and Minnesota, where just over 15 percent of the workforce would receive a raise. Washington’s state minimum wage is scheduled to go to $13.50 in 2020 with automatic adjustments for inflation thereafter, and the city of Seattle raised its minimum wage to $15 for all businesses as of January 2019. In Minnesota, the state minimum wage is $9.86 as of January 2019, and it will be adjusted for inflation in subsequent years; however, both Minneapolis and St. Paul will have local $15 minimum wages by 2022. Because the Twin Cities make up the majority of the state labor market, the changing federal minimum has less of an impact on the state as a whole.

In contrast, the share of the workforce that would be impacted by a federal increase is significantly larger in states with low minimum wages—or, in some cases, no minimum wage—such as in Arkansas, North Carolina, Mississippi, Louisiana, and Idaho.15 Workers in the Southeast, in particular, are most likely to see a pay increase if the federal minimum wage is raised. The largest impact would be in Mississippi, where more than four in 10 workers (41.6 percent) are likely to be affected by the bill, and the average affected worker would receive a 20 percent raise—the largest average raise of any state’s workforce.

Other aspects of the proposal

In addition to the six phased-in increases from 2019 to 2024, the Raise the Wage Act would also “index” the minimum wage to the median wage and (as mentioned in the previous section) would gradually phase out the subminimum wage for tipped workers. This section explains how these two provisions would benefit workers.

Indexing to the median wage

After the minimum wage reaches $15 in 2024, the Raise the Wage Act would index the minimum wage to the median wage so that in subsequent years, as wages throughout the workforce rise, the minimum wage would automatically be lifted to maintain its value relative to the median wage. This is different from how most minimum wage indexing has been done in the past. Currently 17 states and the District of Columbia have enacted indexing of their state minimum wages to changes in prices, typically as measured by changes in the Consumer Price Index (CPI). (The automatic annual adjustments this indexing mandates have not yet taken effect in all of these states.) Indexing to prices prevents any erosion in the minimum’s real (inflation-adjusted) value, thereby ensuring that low-wage workers can still afford the same amount of goods and services year after year. This is certainly advantageous relative to having no indexing; however, indexing to prices effectively legislates that the lowest-paid workers never see any material improvement in their quality of life. The real value of the minimum wage remains frozen, regardless of increases in overall labor productivity or technological advances that improve the country’s ability to improve living standards.

In contrast, linking the minimum wage to the median wage ensures that low-wage workers do not lose ground relative to typical workers. As Zipperer (2015b) explains, indexing to the median wage “links the minimum wage to overall conditions in the labor market.” To the extent that productivity improvements and technological progress result in higher wages for the typical U.S. worker, so too will minimum wage workers see their hourly pay rise. It is of course true that both low- and middle-wage workers have seen their hourly pay lag relative to productivity growth in recent decades. A stronger minimum wage ensures that the vast majority of U.S. workers share a common trajectory of wage growth. But the minimum wage needs to be complemented by other policies to ensure that wage growth for this entire vast majority rises in step with overall productivity growth.16

Another good reason for indexing to the median wage rather than to price indices is that wages are less volatile than prices. Price indices, such as the CPI, are subject to unpredictable changes in the price of food and energy that may be driven by temporary events, such as political instability or natural disasters. Wages, on the other hand, tend to be more stable, rising as fast—or faster—than prices over the long term, and with greater predictability for employers and employees alike (see Zipperer 2015b or Shierholz 2009).

Eliminating the subminimum wage for tipped workers

Under current federal law, employers of workers who customarily receive tips are only required to pay their tipped staff a base wage of $2.13 per hour, provided employees’ weekly income from tips plus their base wage equates to an hourly rate of at least the minimum wage. As explained by Allegretto and Cooper (2014), this separate wage standard results in a host of problems for tipped workers, including dramatically higher poverty rates and greater reliance on public assistance. Contrary to a common perception that waitstaff and bartenders make lavish incomes from tips, the vast majority of tipped work is low-paying. From 2014 to 2016, the median wage for tipped workers, including earnings from tips, was $11.00 per hour—37 percent less than the median wage of workers who do not rely on tips (Cooper 2017). Because the majority of tipped workers’ pay is from tips—as opposed to a regular paycheck—weekly income can be highly erratic and subject to a greater incidence of wage theft (Allegretto and Cooper 2014).17 Moreover, the fact that most tipped workers are women means that the inequities produced by this separate wage system exacerbate existing gender-based wage inequality (see National Women’s Law Center 2016).

The Raise the Wage Act would raise the subminimum wage for tipped workers over nine years until it reaches parity with the full minimum wage, as is currently the case in seven states.18 These seven states have significantly lower poverty rates among tipped workers than the states where tipped workers are paid a lower base wage. At the same time, growth in the restaurant industry has been as strong, if not stronger, in the states where tipped and nontipped employees are treated equally. This suggests that requiring employers to pay regular wages to tipped workers has had no significant negative effect on the growth of the restaurant industry (Allegretto 2013).

Effects on job growth and workers’ welfare

Whenever any minimum wage increase is proposed, concerns are always raised about the impact such a policy change might have on the employment of low-wage workers.19 Given this, it is not surprising that the effect of the minimum wage on employment has been one of the most heavily studied topics in economics, particularly since the 1990s. A full review of that literature is beyond the scope of this report; Schmitt (2013), Kuehn (2014), and Wolfson and Belman (2016), however, offer useful summaries.

The overwhelming conclusion of this literature has been that past increases in minimum wages have had little to no effect on employment. In their meta-analysis of 739 estimated effects from 37 published studies on the minimum wage and employment between 2000 and 2015, Wolfson and Belman (2016) find “no support for the proposition that the minimum wage has had an important effect on U.S. employment.” Moreover, Allegretto et al. (2017) find that studies that employ the most credible research designs (comparing similar jurisdictions that have raised their minimum wage with those that have not) also find little to no effect on employment. In other words, both the average study and the highest-quality studies find little to no impact of the minimum wage on employment.

In what has been hailed as the most important work on the minimum wage in 25 years, Cengiz et al. (2019) use a novel methodology to estimate the employment effect of minimum wages by examining 138 state minimum wage changes that occurred in the United States between 1979 and 2014.20 They find that even with minimum wages rising as high as 55 percent of the median wage, there was no evidence of any reduction in the total number of jobs for low-wage workers.21 Moreover, the researchers examined effects specifically for workers without a college degree, underrepresented minorities, and young workers—groups that might have greater difficulty in finding work—and still found no evidence of substantial job losses.

This large body of research is useful for understanding the appropriateness of the minimum wage level proposed by the Raise the Wage Act of 2019. Raising the federal minimum wage to $15 by 2024 would bring the U.S. wage floor above its historical high point, both in absolute terms and relative to the wages of middle-wage workers. As noted in Figure C in the first section of this report, a minimum wage of $15 would likely equal between 56 and 58 percent of the full-time median wage in 2024—just slightly beyond the range of minimum wages that have been studied. Given that research on the existing experience of the minimum wage in the United States has never led to evidence of meaningful negative effect on employment, Cooper, Mishel, and Zipperer (2018) explain that raising the minimum wage beyond historical experience is, in fact, the optimal policy choice. If existing research has shown that prior minimum wage increases have had no clear, detectable downside, then any increase that does not exceed past experience would leave money on the table that could otherwise have been earned by low-wage workers.

Furthermore, Cooper, Mishel, and Zipperer go on to explain that the narrow focus on potential employment effects of minimum wage increases is a deeply flawed way of evaluating the merits of the policy, since what matters most is not whether the minimum wage changes someone’s work status at any given time, but how the policy affects his or her total earnings. For example, even in the scenario where a minimum wage increase had a negative effect on job growth, there is no reason to assume that anyone would be worse off. Any reduction in job growth is implicitly a reduction in the total hours worked by low-wage workers. Because there is a high degree of churn in the low-wage labor market—i.e., low-wage workers cycle in and out of jobs frequently—it is likely that any reduction in hours would be spread across many low-wage workers, with some working fewer hours per week and others having longer spells between jobs throughout the year. However, because they will all be earning more per hour than they would have otherwise, it’s entirely possible that few, if any, workers will actually see a reduction in their total annual take-home pay.

Indeed, two recent studies show that regardless of any potential employment changes, minimum wage increases have had clear positive effects on the total annual incomes of low-wage workers and their families. Dube (2018) shows that minimum wage increases raised family incomes at the bottom of the income distribution. Using high-quality administrative data, Rinz and Voorheis (2018)—researchers at the U.S. Census Bureau—find that minimum wage increases raised individual incomes and that those income gains accelerated for up to five years after the policy change. In other words, any potential hours reductions or other decreases in employment that might have resulted from past minimum wage increase were apparently not large enough to reduce overall annual earnings for low-wage families.

Conclusion

Since its inception during the Great Depression, a strong minimum wage has been recognized as a key labor market institution that, if effectively maintained, can provide the foundation for equitable and adequate pay for American workers. However, the failure to regularly and adequately raise the federal minimum wage over the past five decades is one of several policy failures that have denied a generation of American workers more significant improvement in their quality of life. In fact, the erosion of the minimum wage has left low-wage workers today earning significantly less than their counterparts 50 years ago.

Raising the federal minimum wage to $15 by 2024 would take its value to a level that finally ensures full-time work is a means to escape poverty, and it would provide tens of millions of America’s lowest-paid workers with a substantial, long-overdue improvement in their standard of living. Past increases in the minimum wage have been inadequate to preserve low-wage workers’ standard of living, let alone allow them to share in the broader benefits of rising productivity and a growing economy. In contrast, the Raise the Wage Act of 2019 is a bold proposal that would achieve these goals.

Automating future increases by indexing to growth in the median wage would ensure workers at the bottom of the wage scale are never again left behind as productivity improvements lead to broader improvements in wages. In addition, gradually raising and eliminating the separate lower wage for tipped workers would eliminate the disparities in labor protections and living standards that currently exist between tipped and nontipped workers. These actions would significantly improve the well-being of millions of American workers and their families, and they would help to reduce long-standing race- and gender-based wage inequities.

Decades of research have shown that past minimum wage increases have had their intended effect—raising incomes for low-wage workers with little, if any, negative impact on their employment. As lawmakers propose lifting the U.S. wage floor to new heights, this research affirms their ambition. Anything less would be needlessly timid and would potentially deprive millions of low-wage workers of earnings they could have had with little cost.

About the author

David Cooper joined the Economic Policy Institute in 2011. As senior economic analyst, he conducts national and state-level research, with a focus on the minimum wage, employment and unemployment, poverty, and wage and income trends. Cooper is also the deputy director of the Economic Analysis and Research Network (EARN), a national network of over 60 state-level policy research and advocacy organizations.

Cooper has testified at numerous state and municipal hearings on the challenges facing low-wage workers and their families. His analyses on the impact of minimum wage laws have been used by policymakers and advocates in city halls and statehouses across the country as well as in Congress and the White House. He has been interviewed and cited by numerous local and national media, including The New York Times, The Washington Post, The Wall Street Journal, CNBC, and NPR.

He holds Master of Public Policy and Bachelor of Arts degrees from Georgetown University.

Appendix: Data tables

Appendix Table 1

Summary of minimum wage increases under the Raise the Wage Act of 2019, and number of workers affected by the increases, 2019–2024

Date

New minimum wage

Increase

New tipped minimum wage

Tipped minimum increase

Total estimated U.S. workforce (thousands)

Directly affected (thousands)

Indirectly affected (thousands)

Total affected (thousands)

Affected workers’ share of U.S. workforce

July 2019

$8.55

$1.30

$3.60

$1.47

145,172

2,890

4,668

7,558

5.2%

July 2020

$9.85

$1.30

$5.10

$1.50

145,957

7,345

8,255

15,600

10.7%

July 2021

$11.15

$1.30

$6.60

$1.50

146,766

14,043

7,466

21,510

14.7%

July 2022

$12.45

$1.30

$8.10

$1.50

147,599

18,419

8,639

27,059

18.3%

July 2023

$13.75

$1.30

$9.60

$1.50

148,457

22,082

11,770

33,853

22.8%

July 2024

$15.00

$1.25

$11.10

$1.50

149,340

28,078

11,595

39,673

26.6%

Notes: Values reflect the result of the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate exceeds their existing hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage. Wage increase totals are cumulative of all preceding steps.

Wage impacts of increasing the minimum wage under the Raise the Wage Act of 2019, 2019–2024 (2018$)

Directly affected workers

All (directly & indirectly) affected workers

Date

New minimum wage (nominal $)

New minimum wage 2018$)

New tipped minimum wage (nominal $)

New tipped minimum wage 2018$)

Total wage increase (thousands)

Change in avg. hourly wage

Change in avg. annual income (year-round workers)

Real percent change in avg. annual income

Total wage increase (thousands)

Change in avg. hourly wage

Change in avg. annual earnings (year-round workers)

Real percent change in avg. annual earnings

July 2019

$8.55

$8.35

$3.60

$3.52

$3,110,218

$0.76

$1,080

9.9%

$5,327,000

$0.46

$700

4.8%

July 2020

$9.85

$9.39

$5.10

$4.86

$10,795,424

$1.01

$1,470

11.4%

$14,723,132

$0.62

$940

5.9%

July 2021

$11.15

$10.37

$6.60

$6.14

$25,628,622

$1.21

$1,820

12.0%

$30,162,310

$0.91

$1,400

8.1%

July 2022

$12.45

$11.30

$8.10

$7.35

$48,383,312

$1.69

$2,630

16.2%

$53,675,376

$1.26

$1,980

10.6%

July 2023

$13.75

$12.18

$9.60

$8.50

$76,943,540

$2.19

$3,480

20.2%

$84,224,367

$1.55

$2,490

12.5%

July 2024

$15.00

$12.98

$11.10

$9.60

$109,348,838

$2.40

$3,890

20.9%

$117,967,152

$1.83

$2,970

14.0%

Notes: Values reflect the result of the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI's Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage. Wage increase totals are cumulative of all preceding steps.

Demographic characteristics of workers affected by increasing the federal minimum wage to $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All workers

149,340

28,078

18.8%

11,595

7.8%

39,673

26.6%

100.0%

Gender

Women

72,465

16,478

22.7%

6,479

8.9%

22,957

31.7%

57.9%

Men

76,875

11,600

15.1%

5,116

6.7%

16,716

21.7%

42.1%

Age

Age 19 or younger

5,213

3,366

64.6%

337

6.5%

3,702

71.0%

9.3%

Age 20 or older

144,126

24,712

17.1%

11,258

7.8%

35,970

25.0%

90.7%

Ages 16–24

20,313

10,834

53.3%

2,052

10.1%

12,886

63.4%

32.5%

Ages 25–39

50,239

8,890

17.7%

4,446

8.9%

13,336

26.5%

33.6%

Ages 40–54

47,723

4,632

9.7%

3,011

6.3%

7,643

16.0%

19.3%

Age 55 or older

31,065

3,722

12.0%

2,086

6.7%

5,807

18.7%

14.6%

Race/ethnicity

White

89,375

14,187

15.9%

6,514

7.3%

20,701

23.2%

52.2%

Black

17,564

5,079

28.9%

1,621

9.2%

6,700

38.1%

16.9%

Hispanic

28,702

6,984

24.3%

2,598

9.1%

9,583

33.4%

24.2%

Asian

9,641

909

9.4%

526

5.5%

1,435

14.9%

3.6%

Other race/ethnicity

4,057

919

22.6%

335

8.3%

1,254

30.9%

3.2%

Women of color

29,027

7,792

26.8%

2,554

8.8%

10,346

35.6%

26.1%

Men of color

30,937

6,099

19.7%

2,526

8.2%

8,626

27.9%

21.7%

Family status

Married parent

37,727

3,656

9.7%

2,231

5.9%

5,887

15.6%

14.8%

Single parent

13,783

3,877

28.1%

1,478

10.7%

5,355

38.9%

13.5%

Married, no children

38,401

3,929

10.2%

2,413

6.3%

6,342

16.5%

16.0%

Unmarried, no children

59,430

16,616

28.0%

5,473

9.2%

22,089

37.2%

55.7%

Education

Less than high school

15,045

6,159

40.9%

1,529

10.2%

7,688

51.1%

19.4%

High school

37,103

10,299

27.8%

4,233

11.4%

14,532

39.2%

36.6%

Some college, no degree

34,755

8,536

24.6%

3,429

9.9%

11,965

34.4%

30.2%

Associate degree

13,495

1,801

13.3%

1,105

8.2%

2,906

21.5%

7.3%

Bachelor’s degree or higher

48,942

1,282

2.6%

1,299

2.7%

2,582

5.3%

6.5%

Family income

Less than $25,000

20,098

10,276

51.1%

2,516

12.5%

12,792

63.6%

32.2%

$25,000–$49,999

30,386

6,930

22.8%

3,882

12.8%

10,812

35.6%

27.3%

$50,000–$74,999

27,730

4,344

15.7%

2,189

7.9%

6,533

23.6%

16.5%

$75,000–$99,999

21,733

2,597

12.0%

1,288

5.9%

3,885

17.9%

9.8%

$100,000–$149,999

26,711

2,506

9.4%

1,120

4.2%

3,626

13.6%

9.1%

$150,000 or more

22,682

1,425

6.3%

600

2.6%

2,025

8.9%

5.1%

Family income-to-poverty ratio

At or below the poverty line

10,292

5,914

57.5%

1,013

9.8%

6,927

67.3%

17.5%

101–200% of poverty line

21,646

8,410

38.9%

3,190

14.7%

11,600

53.6%

29.2%

201–400% of poverty line

46,889

8,341

17.8%

4,798

10.2%

13,138

28.0%

33.1%

401% or above

69,575

4,858

7.0%

2,535

3.6%

7,393

10.6%

18.6%

Poverty status not available

938

555

59.2%

60

6.4%

615

65.6%

1.5%

Work hours

Part time (<20 hours)

8,637

3,398

39.3%

784

9.1%

4,182

48.4%

10.5%

Mid time (20– 34 hours)

22,177

9,349

42.2%

2,352

10.6%

11,701

52.8%

29.5%

Full time (35+ hours)

118,525

15,331

12.9%

8,458

7.1%

23,789

20.1%

60.0%

Industry

Agriculture, forestry, fishing, hunting

2,434

523

21.5%

184

7.6%

707

29.1%

1.8%

Construction

8,228

993

12.1%

618

7.5%

1,611

19.6%

4.1%

Manufacturing

16,443

2,017

12.3%

1,138

6.9%

3,155

19.2%

8.0%

Wholesale trade

4,072

543

13.3%

280

6.9%

823

20.2%

2.1%

Retail trade

17,572

6,071

34.6%

1,739

9.9%

7,811

44.4%

19.7%

Transportation, warehousing, utilities

7,773

799

10.3%

494

6.4%

1,293

16.6%

3.3%

Information

3,188

263

8.2%

130

4.1%

392

12.3%

1.0%

Finance, insurance, real estate

9,531

656

6.9%

442

4.6%

1,098

11.5%

2.8%

Professional, scientific, management, technical services

9,256

381

4.1%

240

2.6%

620

6.7%

1.6%

Administrative, support, and waste management

5,968

1,646

27.6%

584

9.8%

2,231

37.4%

5.6%

Education

14,673

1,725

11.8%

759

5.2%

2,483

16.9%

6.3%

Health care

21,437

3,952

18.4%

1,613

7.5%

5,565

26.0%

14.0%

Arts, entertainment, recreational services

3,028

960

31.7%

357

11.8%

1,317

43.5%

3.3%

Accommodation

1,803

700

38.8%

246

13.7%

947

52.5%

2.4%

Restaurants and food service

10,290

4,995

48.5%

1,691

16.4%

6,686

65.0%

16.9%

Other services

6,039

1,508

25.0%

818

13.5%

2,326

38.5%

5.9%

Public administration

7,606

346

4.5%

262

3.4%

607

8.0%

1.5%

Tipped occupations

Tipped workers

4,393

1,778

40.5%

1,828

41.6%

3,606

82.1%

9.1%

Nontipped workers

144,947

26,300

18.1%

9,767

6.7%

36,067

24.9%

90.9%

Sector

For-profit

113,570

24,250

21.4%

9,760

8.6%

34,010

29.9%

85.7%

Government

22,641

2,027

9.0%

1,037

4.6%

3,064

13.5%

7.7%

Nonprofit

13,128

1,801

13.7%

798

6.1%

2,599

19.8%

6.6%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Number and share of U.S. children affected by increasing the federal minimum wage to $15 by 2024

In directly affected households

In indirectly affected households

Group

Number (thousands)

Share of U.S. children*

Number (thousands)

Share of U.S. children*

Total number affected (thousands)

Total share of U.S. children* affected

Children with at least one parent† who would benefit

9,433

12.9%

4,956

6.8%

14,389

19.6%

Children with at least one adult† in the household who would benefit

12,432

16.9%

5,645

7.7%

18,077

24.6%

* Shares are out of an estimated total of 73,356,000 children living in the United States.

† “Parent” refers to the biological or adoptive parent of a child. “Adult” refers to any adult living in the child’s household—e.g., parent, grandparent, caretaker, or adult sibling.

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Sources: Economic Policy Institute Minimum Wage Simulation Model using data from the Census Bureau, Bureau of Labor Statistics, and Congressional Budget Office. See Cooper, Mokhiber, and Zipperer 2019. Estimate for total number of U.S. children comes from U.S. Census Bureau 2017.

Notes: Values reflect the result of the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers would see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They would receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of women workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All women workers

72,465

16,478

22.7%

6,479

8.9%

22,957

31.7%

100.0%

Age

Age 19 or younger

2,710

1,770

65.3%

166

6.1%

1,936

71.4%

8.4%

Age 20 or older

69,754

14,708

21.1%

6,313

9.1%

21,021

30.1%

91.6%

Ages 16–24

10,171

5,659

55.6%

997

9.8%

6,655

65.4%

29.0%

Ages 25–39

23,678

5,014

21.2%

2,282

9.6%

7,297

30.8%

31.8%

Ages 40–54

23,162

3,277

14.1%

1,884

8.1%

5,161

22.3%

22.5%

Age 55 or older

15,454

2,528

16.4%

1,316

8.5%

3,843

24.9%

16.7%

Race/ethnicity

White

43,437

8,686

20.0%

3,925

9.0%

12,611

29.0%

54.9%

Black

9,658

3,043

31.5%

918

9.5%

3,961

41.0%

17.3%

Hispanic

12,599

3,664

29.1%

1,137

9.0%

4,801

38.1%

20.9%

Asian

4,710

552

11.7%

312

6.6%

864

18.3%

3.8%

Other race/ethnicity

2,060

533

25.9%

187

9.1%

720

35.0%

3.1%

Women of color

29,027

7,792

26.8%

2,554

8.8%

10,346

35.6%

26.1%

Family status

Married parent

16,375

2,440

14.9%

1,269

7.8%

3,709

22.7%

16.2%

Single parent

9,565

3,053

31.9%

1,063

11.1%

4,116

43.0%

17.9%

Married, no children

18,223

2,593

14.2%

1,505

8.3%

4,098

22.5%

17.9%

Unmarried, no children

28,302

8,392

29.7%

2,641

9.3%

11,033

39.0%

48.1%

Education

Less than high school

5,858

3,026

51.7%

545

9.3%

3,571

61.0%

15.6%

High school

16,211

5,962

36.8%

2,249

13.9%

8,211

50.7%

35.8%

Some college, no degree

17,487

5,352

30.6%

2,068

11.8%

7,420

42.4%

32.3%

Associate degree

7,542

1,242

16.5%

749

9.9%

1,991

26.4%

8.7%

Bachelor’s degree or higher

25,366

896

3.5%

869

3.4%

1,764

7.0%

7.7%

Family income

Less than $25,000

10,654

5,959

55.9%

1,266

11.9%

7,225

67.8%

31.5%

$25,000–$49,999

15,084

4,129

27.4%

2,053

13.6%

6,181

41.0%

26.9%

$50,000–$74,999

13,315

2,669

20.0%

1,315

9.9%

3,984

29.9%

17.4%

$75,000–$99,999

10,366

1,533

14.8%

812

7.8%

2,345

22.6%

10.2%

$100,000–$149,999

12,573

1,418

11.3%

681

5.4%

2,099

16.7%

9.1%

$150,000 or more

10,472

770

7.4%

352

3.4%

1,122

10.7%

4.9%

Family income-to-poverty ratio

At or below the poverty line

5,827

3,602

61.8%

534

9.2%

4,136

71.0%

18.0%

101–200% of poverty line

10,896

4,874

44.7%

1,663

15.3%

6,537

60.0%

28.5%

201–400% of poverty line

22,579

4,916

21.8%

2,695

11.9%

7,611

33.7%

33.2%

401% or above

32,602

2,749

8.4%

1,555

4.8%

4,304

13.2%

18.7%

Poverty status not available

560

336

59.9%

33

5.9%

369

65.8%

1.6%

Work hours

Part time (<20 hours)

5,570

2,160

38.8%

538

9.7%

2,698

48.4%

11.8%

Mid time (20– 34 hours)

14,090

5,837

41.4%

1,553

11.0%

7,390

52.4%

32.2%

Full time (35+ hours)

52,805

8,480

16.1%

4,389

8.3%

12,869

24.4%

56.1%

Industry

Agriculture, forestry, fishing, hunting

496

120

24.2%

39

7.8%

159

31.9%

0.7%

Construction

811

103

12.7%

62

7.6%

165

20.3%

0.7%

Manufacturing

4,806

968

20.1%

466

9.7%

1,434

29.8%

6.2%

Wholesale trade

1,235

212

17.2%

101

8.2%

313

25.3%

1.4%

Retail trade

8,726

3,660

41.9%

969

11.1%

4,630

53.1%

20.2%

Transportation, warehousing, utilities

1,961

272

13.9%

161

8.2%

433

22.1%

1.9%

Information

1,327

152

11.5%

79

5.9%

231

17.4%

1.0%

Finance, insurance, real estate

5,338

445

8.3%

316

5.9%

760

14.2%

3.3%

Professional, scientific, management, technical services

4,176

270

6.5%

175

4.2%

445

10.7%

1.9%

Administrative, support, and waste management

2,377

757

31.9%

238

10.0%

995

41.9%

4.3%

Education

10,030

1,231

12.3%

564

5.6%

1,796

17.9%

7.8%

Health care

16,929

3,373

19.9%

1,375

8.1%

4,748

28.0%

20.7%

Arts, entertainment, recreational services

1,413

498

35.2%

184

13.0%

682

48.3%

3.0%

Accommodation

1,041

482

46.3%

131

12.6%

613

58.9%

2.7%

Restaurants and food service

5,356

2,802

52.3%

932

17.4%

3,733

69.7%

16.3%

Other services

3,054

931

30.5%

537

17.6%

1,469

48.1%

6.4%

Public administration

3,390

200

5.9%

151

4.5%

352

10.4%

1.5%

Tipped occupations

Tipped workers

2,967

1,291

43.5%

1,178

39.7%

2,469

83.2%

10.8%

Nontipped workers

69,497

15,186

21.9%

5,301

7.6%

20,487

29.5%

89.2%

Sector

For-profit

51,183

13,863

27.1%

5,217

10.2%

19,080

37.3%

83.1%

Government

12,716

1,360

10.7%

690

5.4%

2,051

16.1%

8.9%

Nonprofit

8,565

1,254

14.6%

571

6.7%

1,826

21.3%

8.0%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of black workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All black workers

17,564

5,079

28.9%

1,621

9.2%

6,700

38.1%

100.0%

Gender

Women

9,658

3,043

31.5%

918

9.5%

3,961

41.0%

59.1%

Men

7,907

2,036

25.7%

703

8.9%

2,739

34.6%

40.9%

Age

Age 19 or younger

559

371

66.3%

29

5.2%

399

71.5%

6.0%

Age 20 or older

17,006

4,709

27.7%

1,592

9.4%

6,300

37.0%

94.0%

Ages 16–24

2,497

1,593

63.8%

199

7.9%

1,791

71.7%

26.7%

Ages 25–39

6,145

1,891

30.8%

660

10.7%

2,552

41.5%

38.1%

Ages 40–54

5,737

945

16.5%

490

8.5%

1,435

25.0%

21.4%

Age 55 or older

3,185

650

20.4%

272

8.5%

922

29.0%

13.8%

Family status

Married parent

3,009

447

14.8%

230

7.6%

676

22.5%

10.1%

Single parent

3,031

1,117

36.8%

335

11.1%

1,452

47.9%

21.7%

Married, no children

3,012

491

16.3%

238

7.9%

729

24.2%

10.9%

Unmarried, no children

8,513

3,024

35.5%

818

9.6%

3,842

45.1%

57.3%

Educational attainment

Less than high school

1,457

787

54.1%

137

9.4%

924

63.4%

13.8%

High school

5,115

2,048

40.0%

610

11.9%

2,657

52.0%

39.7%

Some college, no degree

5,155

1,726

33.5%

568

11.0%

2,293

44.5%

34.2%

Associate degree

1,625

326

20.1%

159

9.8%

485

29.8%

7.2%

Bachelor’s degree or higher

4,212

192

4.6%

148

3.5%

340

8.1%

5.1%

Family income

Less than $25,000

3,527

2,237

63.4%

370

10.5%

2,608

73.9%

38.9%

$25,000–$49,999

4,697

1,399

29.8%

669

14.2%

2,068

44.0%

30.9%

$50,000–$74,999

3,401

688

20.2%

293

8.6%

982

28.9%

14.7%

$75,000–$99,999

2,228

347

15.6%

141

6.3%

488

21.9%

7.3%

$100,000–$149,999

2,300

285

12.4%

102

4.4%

388

16.9%

5.8%

$150,000 or more

1,411

122

8.7%

45

3.2%

167

11.8%

2.5%

Family income-to-poverty ratio

At or below the poverty line

1,896

1,310

69.1%

144

7.6%

1,454

76.7%

21.7%

101–200% of poverty line

3,541

1,773

50.1%

524

14.8%

2,297

64.9%

34.3%

201–400% of poverty line

6,160

1,378

22.4%

710

11.5%

2,088

33.9%

31.2%

401% or above

5,850

545

9.3%

237

4.1%

782

13.4%

11.7%

Poverty status not available

117

73

62.4%

6

5.2%

79

67.5%

1.2%

Work hours

Part time (<20 hours)

900

403

44.8%

69

7.7%

472

52.4%

7.0%

Mid time (20– 34 hours)

2,824

1,562

55.3%

256

9.1%

1,819

64.4%

27.1%

Full time (35+ hours)

13,841

3,114

22.5%

1,295

9.4%

4,409

31.9%

65.8%

Industry

Agriculture, forestry, fishing, hunting

94

31

32.7%

8

8.0%

39

40.8%

0.6%

Construction

443

77

17.4%

38

8.6%

116

26.1%

1.7%

Manufacturing

1,589

398

25.0%

177

11.1%

575

36.2%

8.6%

Wholesale trade

312

87

27.8%

31

10.0%

118

37.8%

1.8%

Retail trade

2,081

1,003

48.2%

206

9.9%

1,209

58.1%

18.0%

Transportation, warehousing, utilities

1,324

235

17.7%

121

9.2%

356

26.9%

5.3%

Information

350

50

14.2%

22

6.3%

72

20.5%

1.1%

Finance, insurance, real estate

1,007

119

11.8%

68

6.7%

186

18.5%

2.8%

Professional, scientific, management, technical services

589

42

7.2%

24

4.0%

66

11.2%

1.0%

Administrative, support, and waste management

977

376

38.5%

111

11.3%

486

49.8%

7.3%

Education

1,588

310

19.5%

111

7.0%

421

26.5%

6.3%

Health care

3,613

1,049

29.0%

343

9.5%

1,392

38.5%

20.8%

Arts, entertainment, recreational services

291

121

41.5%

36

12.5%

157

53.9%

2.3%

Accommodation

266

142

53.3%

33

12.5%

175

65.8%

2.6%

Restaurants and food service

1,225

756

61.7%

153

12.5%

908

74.2%

13.6%

Other services

578

190

32.9%

78

13.5%

269

46.4%

4.0%

Public administration

1,238

94

7.6%

60

4.9%

155

12.5%

2.3%

Sector

For-profit

12,677

4,257

33.6%

1,292

10.2%

5,549

43.8%

82.8%

Government

3,366

484

14.4%

210

6.2%

693

20.6%

10.3%

Nonprofit

1,521

339

22.3%

119

7.8%

458

30.1%

6.8%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of Hispanic workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All Hispanic workers

28,702

6,984

24.3%

2,598

9.1%

9,583

33.4%

100.0%

Gender

Women

12,599

3,664

29.1%

1,137

9.0%

4,801

38.1%

50.1%

Men

16,103

3,321

20.6%

1,461

9.1%

4,782

29.7%

49.9%

Age

Age 19 or younger

1,199

655

54.6%

73

6.1%

728

60.7%

7.6%

Age 20 or older

27,503

6,330

23.0%

2,525

9.2%

8,855

32.2%

92.4%

Ages 16–24

4,893

2,286

46.7%

427

8.7%

2,713

55.4%

28.3%

Ages 25–39

11,412

2,632

23.1%

1,139

10.0%

3,771

33.0%

39.3%

Ages 40–54

8,881

1,419

16.0%

745

8.4%

2,165

24.4%

22.6%

Age 55 or older

3,516

648

18.4%

287

8.2%

935

26.6%

9.8%

Family status

Married parent

8,163

1,403

17.2%

719

8.8%

2,122

26.0%

22.1%

Single parent

3,861

1,158

30.0%

393

10.2%

1,551

40.2%

16.2%

Married, no children

5,178

924

17.8%

441

8.5%

1,365

26.4%

14.2%

Unmarried, no children

11,501

3,500

30.4%

1,046

9.1%

4,545

39.5%

47.4%

Educational attainment

Less than high school

7,643

2,745

35.9%

773

10.1%

3,518

46.0%

36.7%

High school

8,192

2,240

27.3%

895

10.9%

3,135

38.3%

32.7%

Some college, no degree

6,378

1,515

23.7%

596

9.3%

2,111

33.1%

22.0%

Associate degree

1,952

305

15.6%

170

8.7%

475

24.3%

5.0%

Bachelor’s degree or higher

4,538

180

4.0%

164

3.6%

344

7.6%

3.6%

Family income

Less than $25,000

5,378

2,540

47.2%

545

10.1%

3,085

57.4%

32.2%

$25,000–$49,999

7,610

2,020

26.5%

953

12.5%

2,973

39.1%

31.0%

$50,000–$74,999

5,735

1,154

20.1%

513

8.9%

1,667

29.1%

17.4%

$75,000–$99,999

3,837

605

15.8%

284

7.4%

888

23.2%

9.3%

$100,000–$149,999

3,864

472

12.2%

219

5.7%

691

17.9%

7.2%

$150,000 or more

2,278

193

8.5%

85

3.7%

278

12.2%

2.9%

Family income-to-poverty ratio

At or below the poverty line

3,153

1,579

50.1%

275

8.7%

1,854

58.8%

19.3%

101–200% of poverty line

7,130

2,570

36.0%

864

12.1%

3,434

48.2%

35.8%

201–400% of poverty line

10,651

2,114

19.8%

1,102

10.4%

3,216

30.2%

33.6%

401% or above

7,660

672

8.8%

351

4.6%

1,024

13.4%

10.7%

Poverty status not available

108

49

45.8%

6

5.4%

55

51.1%

0.6%

Work hours

Part time (<20 hours)

1,319

453

34.3%

92

7.0%

545

41.3%

5.7%

Mid time (20– 34 hours)

4,462

1,821

40.8%

370

8.3%

2,191

49.1%

22.9%

Full time (35+ hours)

22,922

4,711

20.6%

2,136

9.3%

6,847

29.9%

71.5%

Industry

Agriculture, forestry, fishing, hunting

986

256

26.0%

86

8.7%

342

34.7%

3.6%

Construction

2,795

527

18.9%

307

11.0%

833

29.8%

8.7%

Manufacturing

3,097

626

20.2%

308

9.9%

935

30.2%

9.8%

Wholesale trade

857

174

20.3%

76

8.8%

250

29.2%

2.6%

Retail trade

3,386

1,144

33.8%

287

8.5%

1,432

42.3%

14.9%

Transportation, warehousing, utilities

1,482

197

13.3%

112

7.6%

309

20.9%

3.2%

Information

424

51

12.1%

23

5.4%

74

17.5%

0.8%

Finance, insurance, real estate

1,401

172

12.3%

95

6.8%

268

19.1%

2.8%

Professional, scientific, management, technical services

985

79

8.0%

45

4.6%

124

12.6%

1.3%

Administrative, support, and waste management

1,866

623

33.4%

183

9.8%

806

43.2%

8.4%

Education

1,938

318

16.4%

118

6.1%

436

22.5%

4.5%

Health care

3,178

709

22.3%

247

7.8%

956

30.1%

10.0%

Arts, entertainment, recreational services

517

170

32.8%

55

10.7%

225

43.5%

2.3%

Accommodation

559

227

40.6%

71

12.7%

298

53.3%

3.1%

Restaurants and food service

2,947

1,279

43.4%

394

13.4%

1,673

56.8%

17.5%

Other services

1,252

372

29.7%

150

12.0%

522

41.7%

5.5%

Public administration

1,031

59

5.7%

40

3.9%

100

9.7%

1.0%

Sector

For-profit

23,991

6,342

26.4%

2,321

9.7%

8,663

36.1%

90.4%

Government

3,124

363

11.6%

161

5.1%

524

16.8%

5.5%

Nonprofit

1,586

279

17.6%

116

7.3%

396

24.9%

4.1%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of Asian or other race/ethnicity workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All Asian workers

13,698

1,827

13.3%

862

6.3%

2,689

19.6%

100.0%

Gender

Women

6,770

1,085

16.0%

499

7.4%

1,584

23.4%

58.9%

Men

6,928

743

10.7%

362

5.2%

1,105

16.0%

41.1%

Age

Age 19 or younger

446

246

55.2%

28

6.3%

274

61.5%

10.2%

Age 20 or older

13,252

1,581

11.9%

834

6.3%

2,415

18.2%

89.8%

Ages 16–24

1,771

756

42.7%

156

8.8%

912

51.5%

33.9%

Ages 25–39

5,333

565

10.6%

330

6.2%

895

16.8%

33.3%

Ages 40–54

4,371

301

6.9%

243

5.6%

544

12.5%

20.2%

Age 55 or older

2,222

205

9.2%

133

6.0%

338

15.2%

12.6%

Family status

Married parent

4,159

282

6.8%

208

5.0%

489

11.8%

18.2%

Single parent

881

189

21.5%

91

10.3%

281

31.9%

10.4%

Married, no children

3,442

275

8.0%

190

5.5%

464

13.5%

17.3%

Unmarried, no children

5,217

1,081

20.7%

373

7.2%

1,455

27.9%

54.1%

Educational attainment

Less than high school

1,180

406

34.4%

126

10.7%

533

45.2%

19.8%

High school

2,312

593

25.7%

273

11.8%

867

37.5%

32.2%

Some college, no degree

2,544

566

22.3%

236

9.3%

803

31.6%

29.8%

Associate degree

1,046

124

11.9%

78

7.4%

202

19.3%

7.5%

Bachelor’s degree or higher

6,615

137

2.1%

148

2.2%

285

4.3%

10.6%

Family income

Less than $25,000

1,689

636

37.6%

187

11.1%

823

48.7%

30.6%

$25,000–$49,999

2,298

423

18.4%

254

11.0%

677

29.5%

25.2%

$50,000–$74,999

2,201

280

12.7%

157

7.1%

437

19.9%

16.3%

$75,000–$99,999

1,831

173

9.5%

101

5.5%

274

15.0%

10.2%

$100,000–$149,999

2,593

189

7.3%

99

3.8%

288

11.1%

10.7%

$150,000 or more

3,086

127

4.1%

63

2.1%

190

6.2%

7.1%

Family income-to-poverty ratio

At or below the poverty line

935

395

42.2%

92

9.9%

487

52.1%

18.1%

101–200% of poverty line

1,783

506

28.4%

230

12.9%

736

41.3%

27.4%

201–400% of poverty line

3,789

540

14.2%

331

8.7%

871

23.0%

32.4%

401% or above

7,072

335

4.7%

200

2.8%

535

7.6%

19.9%

Poverty status not available

118

52

44.3%

8

6.5%

60

50.8%

2.2%

Work hours

Part time (<20 hours)

844

263

31.2%

64

7.6%

327

38.8%

12.2%

Mid time (20– 34 hours)

1,955

600

30.7%

185

9.5%

785

40.2%

29.2%

Full time (35+ hours)

10,899

964

8.8%

612

5.6%

1,576

14.5%

58.6%

Industry

Agriculture, forestry, fishing, hunting

98

16

16.6%

6

6.1%

22

22.7%

0.8%

Construction

348

30

8.7%

20

5.7%

50

14.4%

1.9%

Manufacturing

1,555

128

8.2%

81

5.2%

209

13.5%

7.8%

Wholesale trade

328

30

9.2%

15

4.7%

45

13.8%

1.7%

Retail trade

1,492

392

26.3%

117

7.8%

509

34.1%

18.9%

Transportation, warehousing, utilities

579

40

7.0%

26

4.5%

66

11.4%

2.5%

Information

352

17

4.9%

8

2.2%

25

7.1%

0.9%

Finance, insurance, real estate

930

33

3.6%

25

2.7%

59

6.3%

2.2%

Professional, scientific, management, technical services

1,419

25

1.7%

14

1.0%

38

2.7%

1.4%

Administrative, support, and waste management

370

71

19.1%

28

7.5%

98

26.6%

3.7%

Education

1,202

123

10.2%

49

4.1%

172

14.3%

6.4%

Health care

2,186

216

9.9%

101

4.6%

317

14.5%

11.8%

Arts, entertainment, recreational services

300

79

26.3%

42

14.1%

121

40.3%

4.5%

Accommodation

235

63

26.7%

37

15.6%

99

42.3%

3.7%

Restaurants and food service

1,057

400

37.8%

152

14.4%

551

52.2%

20.5%

Other services

617

140

22.8%

124

20.1%

265

42.9%

9.8%

Public administration

628

23

3.7%

18

2.8%

41

6.5%

1.5%

Sector

For-profit

10,571

1,577

14.9%

737

7.0%

2,314

21.9%

86.0%

Government

1,955

146

7.5%

72

3.7%

218

11.2%

8.1%

Nonprofit

1,172

105

9.0%

52

4.4%

157

13.4%

5.8%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of white workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All white workers

89,375

14,187

15.9%

6,514

7.3%

20,701

23.2%

100.0%

Gender

Women

43,437

8,686

20.0%

3,925

9.0%

12,611

29.0%

60.9%

Men

45,938

5,501

12.0%

2,589

5.6%

8,090

17.6%

39.1%

Age

Age 19 or younger

3,009

2,094

69.6%

207

6.9%

2,301

76.5%

11.1%

Age 20 or older

86,366

12,092

14.0%

6,308

7.3%

18,400

21.3%

88.9%

Ages 16–24

11,152

6,200

55.6%

1,270

11.4%

7,470

67.0%

36.1%

Ages 25–39

27,349

3,802

13.9%

2,317

8.5%

6,118

22.4%

29.6%

Ages 40–54

28,732

1,967

6.8%

1,533

5.3%

3,499

12.2%

16.9%

Age 55 or older

22,142

2,218

10.0%

1,395

6.3%

3,613

16.3%

17.5%

Family status

Married parent

22,397

1,524

6.8%

1,074

4.8%

2,599

11.6%

12.6%

Single parent

6,010

1,413

23.5%

659

11.0%

2,072

34.5%

10.0%

Married, no children

26,770

2,239

8.4%

1,544

5.8%

3,783

14.1%

18.3%

Unmarried, no children

34,199

9,011

26.3%

3,237

9.5%

12,247

35.8%

59.2%

Educational attainment

Less than high school

4,766

2,220

46.6%

493

10.4%

2,713

56.9%

13.1%

High school

21,484

5,419

25.2%

2,455

11.4%

7,873

36.6%

38.0%

Some college, no degree

20,677

4,729

22.9%

2,028

9.8%

6,757

32.7%

32.6%

Associate degree

8,871

1,046

11.8%

698

7.9%

1,744

19.7%

8.4%

Bachelor’s degree or higher

33,576

773

2.3%

840

2.5%

1,613

4.8%

7.8%

Family income

Less than $25,000

9,503

4,863

51.2%

1,413

14.9%

6,277

66.0%

30.3%

$25,000–$49,999

15,781

3,088

19.6%

2,005

12.7%

5,093

32.3%

24.6%

$50,000–$74,999

16,393

2,221

13.5%

1,226

7.5%

3,447

21.0%

16.6%

$75,000–$99,999

13,837

1,473

10.6%

762

5.5%

2,235

16.2%

10.8%

$100,000–$149,999

17,954

1,559

8.7%

700

3.9%

2,259

12.6%

10.9%

$150,000 or more

15,907

983

6.2%

407

2.6%

1,390

8.7%

6.7%

Family income-to-poverty ratio

At or below the poverty line

4,308

2,630

61.1%

502

11.6%

3,131

72.7%

15.1%

101–200% of poverty line

9,193

3,561

38.7%

1,571

17.1%

5,133

55.8%

24.8%

201–400% of poverty line

26,289

4,310

16.4%

2,654

10.1%

6,964

26.5%

33.6%

401% or above

48,992

3,305

6.7%

1,747

3.6%

5,053

10.3%

24.4%

Poverty status not available

595

380

64.0%

40

6.8%

421

70.7%

2.0%

Work hours

Part time (<20 hours)

5,574

2,280

40.9%

559

10.0%

2,838

50.9%

13.7%

Mid time (20– 34 hours)

12,937

5,365

41.5%

1,541

11.9%

6,906

53.4%

33.4%

Full time (35+ hours)

70,864

6,542

9.2%

4,415

6.2%

10,957

15.5%

52.9%

Industry

Agriculture, forestry, fishing, hunting

1,255

220

17.5%

84

6.7%

304

24.2%

1.5%

Construction

4,642

358

7.7%

254

5.5%

612

13.2%

3.0%

Manufacturing

10,203

865

8.5%

572

5.6%

1,437

14.1%

6.9%

Wholesale trade

2,574

251

9.8%

158

6.1%

409

15.9%

2.0%

Retail trade

10,613

3,532

33.3%

1,129

10.6%

4,661

43.9%

22.5%

Transportation, warehousing, utilities

4,389

327

7.4%

235

5.3%

562

12.8%

2.7%

Information

2,061

144

7.0%

77

3.7%

221

10.7%

1.1%

Finance, insurance, real estate

6,193

331

5.4%

254

4.1%

585

9.5%

2.8%

Professional, scientific, management, technical services

6,263

234

3.7%

157

2.5%

391

6.2%

1.9%

Administrative, support, and waste management

2,756

577

20.9%

263

9.5%

840

30.5%

4.1%

Education

9,944

974

9.8%

481

4.8%

1,455

14.6%

7.0%

Health care

12,460

1,978

15.9%

921

7.4%

2,899

23.3%

14.0%

Arts, entertainment, recreational services

1,920

591

30.8%

224

11.6%

814

42.4%

3.9%

Accommodation

743

269

36.2%

105

14.2%

374

50.3%

1.8%

Restaurants and food service

5,060

2,561

50.6%

992

19.6%

3,553

70.2%

17.2%

Other services

3,591

805

22.4%

465

12.9%

1,270

35.4%

6.1%

Public administration

4,708

169

3.6%

143

3.0%

312

6.6%

1.5%

Sector

For-profit

66,331

12,074

18.2%

5,410

8.2%

17,484

26.4%

84.5%

Government

14,195

1,034

7.3%

594

4.2%

1,629

11.5%

7.9%

Nonprofit

8,849

1,078

12.2%

510

5.8%

1,589

18.0%

7.7%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of Native American workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All Native American workers

873

227

26.0%

90

10.2%

316

36.2%

100.0%

Gender

Women

449

137

30.4%

51

11.3%

187

41.7%

59.2%

Men

424

90

21.3%

39

9.2%

129

30.5%

40.8%

Age

Age 19 or younger

33

22

68.2%

3

7.7%

25

75.9%

7.9%

Age 20 or older

841

205

24.3%

87

10.4%

292

34.7%

92.1%

Ages 16–24

127

78

61.1%

14

11.3%

92

72.4%

29.1%

Ages 25–39

295

81

27.7%

35

11.9%

116

39.5%

36.8%

Ages 40–54

282

41

14.5%

24

8.5%

65

23.0%

20.5%

Age 55 or older

170

27

15.9%

16

9.5%

43

25.4%

13.7%

Family status

Married parent

182

26

14.4%

16

8.7%

42

23.2%

13.4%

Single parent

143

46

32.3%

17

11.8%

63

44.1%

19.9%

Married, no children

182

28

15.2%

15

8.4%

43

23.6%

13.5%

Unmarried, no children

367

127

34.6%

42

11.3%

168

45.9%

53.2%

Educational attainment

Less than high school

96

47

49.0%

11

11.3%

58

60.3%

18.2%

High school

277

91

32.9%

35

12.7%

126

45.6%

40.0%

Some college, no degree

253

69

27.4%

29

11.3%

98

38.7%

30.9%

Associate degree

92

14

15.2%

9

9.4%

23

24.7%

7.1%

Bachelor’s degree or higher

156

6

3.7%

6

3.9%

12

7.6%

3.7%

Family income

Less than $25,000

179

101

56.4%

24

13.6%

125

70.0%

39.5%

$25,000–$49,999

226

59

26.2%

30

13.5%

90

39.7%

28.3%

$50,000–$74,999

172

31

17.8%

17

9.8%

47

27.6%

15.0%

$75,000–$99,999

118

17

14.6%

9

7.3%

26

21.9%

8.1%

$100,000–$149,999

117

14

11.8%

6

5.5%

20

17.3%

6.4%

$150,000 or more

63

6

8.8%

3

4.8%

9

13.7%

2.7%

Family income-to-poverty ratio

At or below the poverty line

104

67

64.4%

11

10.6%

78

75.0%

24.6%

101–200% of poverty line

185

78

42.0%

30

16.4%

108

58.3%

34.1%

201–400% of poverty line

309

58

18.7%

35

11.2%

92

29.9%

29.2%

401% or above

272

23

8.3%

13

4.9%

36

13.2%

11.4%

Poverty status not available

3

2

59.9%

<1

5.7%

2

65.6%

0.6%

Work hours

Part time (<20 hours)

42

20

48.3%

4

9.5%

24

57.8%

7.7%

Mid time (20– 34 hours)

137

70

51.5%

16

11.4%

86

62.9%

27.2%

Full time (35+ hours)

694

136

19.6%

70

10.1%

206

29.7%

65.1%

Industry

Agriculture, forestry, fishing, hunting

22

5

20.5%

2

8.4%

6

28.9%

2.0%

Construction

56

8

14.6%

5

8.4%

13

23.0%

4.0%

Manufacturing

71

11

16.2%

6

8.6%

18

24.9%

5.5%

Wholesale trade

14

2

14.3%

2

11.6%

4

25.8%

1.2%

Retail trade

96

46

47.4%

11

11.1%

56

58.5%

17.8%

Transportation, warehousing, utilities

44

5

11.8%

4

8.5%

9

20.3%

2.8%

Information

11

1

13.2%

1

8.2%

2

21.4%

0.7%

Finance, insurance, real estate

33

4

13.0%

3

10.4%

8

23.4%

2.5%

Professional, scientific, management, technical services

25

3

10.4%

1

4.3%

4

14.7%

1.2%

Administrative, support, and waste management

28

10

36.2%

3

10.9%

13

47.1%

4.2%

Education

81

13

16.3%

6

7.7%

19

24.0%

6.1%

Health care

138

38

27.7%

15

11.2%

54

38.9%

17.0%

Arts, entertainment, recreational services

53

19

35.6%

10

18.2%

28

53.8%

9.0%

Accommodation

20

10

50.0%

2

12.1%

12

62.1%

3.9%

Restaurants and food service

57

33

58.2%

8

14.0%

41

72.2%

13.0%

Other services

29

9

29.1%

4

13.9%

13

43.0%

4.0%

Public administration

94

9

9.8%

7

6.9%

16

16.7%

5.0%

Sector

For-profit

554

171

30.9%

61

11.1%

233

42.0%

73.5%

Government

253

41

16.1%

22

8.8%

63

24.9%

19.9%

Nonprofit

66

15

22.3%

6

9.1%

21

31.4%

6.6%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Demographic characteristics of women of color workers affected by increasing the federal minimum wage by $15 by 2024

Group

Total estimated workforce (thousands)

Directly affected (thousands)

Share directly affected

Indirectly affected (thousands)

Share indirectly affected

Total affected (thousands)

Share of group who are affected

Group’s share of total affected

All women of color workers

29,027

7,792

26.8%

2,554

8.8%

10,346

35.6%

100.0%

Age

Age 19 or younger

1,137

663

58.3%

64

5.6%

726

63.9%

7.0%

Age 20 or older

27,891

7,129

25.6%

2,490

8.9%

9,620

34.5%

93.0%

Ages 16–24

4,551

2,378

52.3%

372

8.2%

2,750

60.4%

26.6%

Ages 25–39

10,739

2,712

25.3%

1,010

9.4%

3,723

34.7%

36.0%

Ages 40–54

9,249

1,744

18.9%

794

8.6%

2,538

27.4%

24.5%

Age 55 or older

4,488

957

21.3%

378

8.4%

1,336

29.8%

12.9%

Family status

Married parent

6,408

1,256

19.6%

527

8.2%

1,783

27.8%

17.2%

Single parent

5,557

1,922

34.6%

583

10.5%

2,505

45.1%

24.2%

Married, no children

5,336

984

18.4%

444

8.3%

1,427

26.7%

13.8%

Unmarried, no children

11,727

3,630

31.0%

1,000

8.5%

4,631

39.5%

44.8%

Educational attainment

Less than high school

3,918

1,869

47.7%

336

8.6%

2,205

56.3%

21.3%

High school

6,873

2,709

39.4%

841

12.2%

3,551

51.7%

34.3%

Some college, no degree

7,362

2,353

32.0%

815

11.1%

3,167

43.0%

30.6%

Associate degree

2,640

512

19.4%

263

10.0%

776

29.4%

7.5%

Bachelor’s degree or higher

8,234

349

4.2%

298

3.6%

647

7.9%

6.3%

Family income

Less than $25,000

5,463

3,026

55.4%

520

9.5%

3,546

64.9%

34.3%

$25,000–$49,999

7,063

2,158

30.6%

896

12.7%

3,054

43.2%

29.5%

$50,000–$74,999

5,386

1,218

22.6%

508

9.4%

1,725

32.0%

16.7%

$75,000–$99,999

3,734

629

16.9%

294

7.9%

924

24.7%

8.9%

$100,000–$149,999

4,124

523

12.7%

231

5.6%

754

18.3%

7.3%

$150,000 or more

3,257

238

7.3%

105

3.2%

343

10.5%

3.3%

Family income-to-poverty ratio

At or below the poverty line

3,318

1,969

59.3%

253

7.6%

2,221

67.0%

21.5%

101–200% of poverty line

6,055

2,660

43.9%

783

12.9%

3,443

56.9%

33.3%

201–400% of poverty line

9,696

2,214

22.8%

1,069

11.0%

3,283

33.9%

31.7%

401% or above

9,753

845

8.7%

437

4.5%

1,282

13.1%

12.4%

Poverty status not available

206

105

51.1%

11

5.5%

117

56.6%

1.1%

Work hours

Part time (<20 hours)

1,930

703

36.4%

150

7.8%

853

44.2%

8.2%

Mid time (20– 34 hours)

5,654

2,469

43.7%

513

9.1%

2,982

52.7%

28.8%

Full time (35+ hours)

21,443

4,620

21.5%

1,892

8.8%

6,511

30.4%

62.9%

Industry

Agriculture, forestry, fishing, hunting

255

65

25.4%

20

8.0%

85

33.4%

0.8%

Construction

246

46

18.6%

20

8.1%

66

26.7%

0.6%

Manufacturing

2,097

572

27.3%

221

10.6%

793

37.8%

7.7%

Wholesale trade

474

110

23.1%

37

7.8%

147

30.9%

1.4%

Retail trade

3,494

1,486

42.5%

316

9.1%

1,802

51.6%

17.4%

Transportation, warehousing, utilities

913

161

17.6%

82

9.0%

243

26.6%

2.3%

Information

479

67

13.9%

30

6.2%

96

20.1%

0.9%

Finance, insurance, real estate

1,913

210

11.0%

125

6.5%

335

17.5%

3.2%

Professional, scientific, management, technical services

1,337

98

7.3%

56

4.2%

153

11.5%

1.5%

Administrative, support, and waste management

1,288

496

38.5%

123

9.5%

619

48.1%

6.0%

Education

3,165

525

16.6%

195

6.2%

720

22.7%

7.0%

Health care

6,999

1,666

23.8%

575

8.2%

2,241

32.0%

21.7%

Arts, entertainment, recreational services

510

184

36.1%

66

12.9%

250

49.0%

2.4%

Accommodation

625

300

48.1%

73

11.7%

373

59.8%

3.6%

Restaurants and food service

2,525

1,283

50.8%

329

13.0%

1,611

63.8%

15.6%

Other services

1,241

418

33.7%

217

17.5%

635

51.2%

6.1%

Public administration

1,464

106

7.2%

70

4.8%

176

12.0%

1.7%

Sector

For-profit

21,450

6,651

31.0%

2,079

9.7%

8,730

40.7%

84.4%

Government

4,887

660

13.5%

285

5.8%

945

19.3%

9.1%

Nonprofit

2,690

481

17.9%

190

7.1%

671

24.9%

6.5%

Notes: Values reflect the population likely to be affected by the proposed change in the federal minimum wage. Wage changes resulting from scheduled state and local minimum wage laws are accounted for by EPI’s Minimum Wage Simulation Model. Totals may not sum due to rounding. Shares calculated from unrounded values. Directly affected workers will see their wages rise as the new minimum wage rate will exceed their current hourly pay. Indirectly affected workers have a wage rate just above the new minimum wage (between the new minimum wage and 115 percent of the new minimum). They will receive a raise as employer pay scales are adjusted upward to reflect the new minimum wage.

Methodology

The Economic Policy Institute Minimum Wage Simulation Model uses data from the Current Population Survey (CPS) and the American Community Survey (ACS) to estimate the size and demographic/workforce characteristics of the populations affected by proposed changes in federal, state, and local minimum wages, as well as the likely impact of those changes on the wages of affected workers. The model accounts for inflation, labor force growth, and all existing state and local minimum wage laws and the likely minimum wages resulting from those laws throughout the simulation period. The statistics in this report were generated using the 2017 ACS five-year microdata and the 2017 CPS Outgoing Rotation Group microdata. A full description of the methodology can be found in Cooper, Mokhiber, and Zipperer 2019.

Endnotes

1. It would also phase out the youth minimum wage, which allows employers to pay workers under 20 a lower wage for the first 90 calendar days of work (U.S. Department of Labor Wage and Hour Division 2008a), and the subminimum wage for workers with disabilities, which allows employers, after receiving a certificate from the Wage and Hour Division of the Department of Labor, to pay workers with disabilities a lower wage (U.S. Department of Labor Wage and Hour Division 2008b).

2. We use the Research Series of the Consumer Price Index for All Urban Consumers (CPI-U) to deflate the value of the minimum wage because the CPI-U tracks changes in the prices of goods bought by typical U.S. consumers. It is the standard deflator used by researchers and government agencies when adjusting wages and incomes for changes in prices. For example, the Census Bureau uses the CPI-U when it measures trends in family and household incomes, and the Internal Revenue Service adjusts tax brackets annually using the CPI-U. The Census Bureau has made various methodological improvements to the CPI-U over the years. The Research Series applies current CPI-U methodology retrospectively to calculate the most accurate measure of historical inflation for typical U.S. consumers. We use the implicit price deflator for gross domestic product—or “GDP deflator”—when calculating changes in total economy net productivity. This is also standard practice, as it captures changes in the value of the overall output of the economy—i.e., the value of what workers are able to produce.

3. Inflation-adjusted values for future years are calculated using the projections for CPI-U in CBO 2018.

4. Overall productivity is measured as total economy productivity net depreciation. From 1968 to 2016, net productivity grew by 100 percent. Based on projections for productivity growth in CBO 2018, growth from 1968 to 2024 is expected to be 119 percent.

5. In a well-functioning economy, growth in wages would consistently outpace inflation. Unfortunately, that has not been the norm for the last half century in the U.S. Median wage growth has barely outpaced inflation over the past 50 years (as shown by the mere 16 percent growth of the median wage in Figure B). Labor market conditions at the start of 2019 are strong enough that it is possible there could be some median wage growth above inflation in the near term. Thus, assuming growth of 0.5 percent above inflation is a plausible, albeit conservative, estimate relative to what wage growth should be in a healthy economy with rising productivity.

7. Wething and Gould (2013) describe the various shortcomings of the federal poverty line and discuss alternative tools for measuring well-being. O’Brien and Pedulla (2010) also discuss the federal poverty line’s inadequacy and provide a useful history of the measure.

9. Dube, Giuliano, and Leonard (2015) observe minimum wage spillover or “ripple” effects for workers earning up to 15 percent above newly implemented minimum wages. Thus, in this analysis, the range of indirectly affected workers is modeled as those workers reporting hourly wages between 100 and 115 percent of the new minimum wage. See Cooper, Mokhiber, and Zipperer 2019 for further detail.

10. Because this increase is larger than past increases that have been rigorously studied, we cannot predict how the higher wage floor might affect the aggregate hours worked by low-wage workers. As explained in greater detail in Cooper, Mishel, and Zipperer (2018), it may be that the total hours worked by the low-wage workforce shrinks. However, the distribution of that shrinkage is not clear. Opponents of minimum wage increases often portray this potential shrinkage as low-wage workers being forced out of the labor market entirely, never to work again. This is a misleading suggestion. The low-wage labor market has very high churn—workers move in and out of jobs frequently, some work multiple jobs, and many will typically spend some portion of the year not working. If the higher minimum wage does lead to a reduction in the total hours of work for low-wage workers, this reduction could manifest as some workers working fewer weeks per year, fewer hours per week, or in fewer jobs if they previously held more than one. In all three scenarios, the workers’ total annual pay is still likely to be higher than it would have been otherwise because of the higher hourly rate they would receive from the minimum wage increase. The clearly harmful outcome would be instances in which workers are truly unable to find work at all, or in which their individual loss of hours outweighs the increased hourly rate of pay, leaving them worse off on net. We believe that such outcomes, if they occur, would affect only a very small fraction of workers in the low-wage labor market, and that the benefits of higher pay for millions more outweigh the risk of such negative outcomes. Moreover, policymakers have other tools (e.g., more generous unemployment benefits, work sharing programs, targeted hiring programs, and many other tools) that they can use to mitigate the impacts of any negative outcomes for workers.

14. For a full list of all states that have enacted minimum wages above the federal minimum wage, and for any scheduled future increases, see EPI’s minimum wage tracker (EPI 2019a).

15. Idaho and North Carolina have minimum wages equal to the federal minimum wage of $7.25. Arkansas voters recently passed a ballot measure increasing the state minimum wage to $11 by 2021, but without any further adjustment thereafter. Tennessee and Mississippi have no minimum wage laws. In these states and others without a minimum wage or with a minimum wage below the federal minimum wage, workers must be paid at least the federal minimum wage.

17. “Wage theft” occurs when employers fail to pay employees the full wages to which they are entitled for the hours they work. See Cooper and Kroeger 2017 or Meixell and Eisenbrey 2014 for greater detail.

18. Tipped workers receive the full minimum wage before tips in Alaska, California, Oregon, Washington, Minnesota, Montana, and Nevada. In 2016, voters in Maine passed a ballot measure that will raise Maine’s tipped minimum wage over a 10-year period until it is equal to the state’s full minimum wage. In Hawaii, tipped workers generally receive the full minimum wage before tips, but employers may pay these workers $0.75 below the regular minimum wage if workers’ combined base wage plus hourly tips equals at least $7.00 more than the regular minimum wage.

21. Cengiz et al. (2019) examine minimum wages as high as 59 percent of the median wage of all workers. This is a slightly different statistic from the median wage of full-time, year-round workers described in the first section of this report. The full-time, year-round workforce is a subset of all workers—some of whom work part time or only part of the year. Because part-time and part-year workers tend to have lower wages than full-time, full-year workers, including them in this calculation lowers the calculated median wage, therefore leading to the minimum wage being a higher percentage of the median wage than would result if calculated using the median wage of full-time, year-round workers. The full-time, year-round median is used in this report because it can be calculated for workers in 1968, allowing for comparisons to the high point of the federal minimum wage. Data allowing for calculations of the median wage of all workers are only available beginning in 1979.

U.S. Census Bureau, Current Population Survey Annual Social and Economic Supplement microdata (U.S. Census Bureau CPS-ASEC). Various years. Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics [machine-readable microdata file]. Accessed December 2018 at https://thedataweb.rm.census.gov/ftp/cps_ftp.html.

U.S. Census Bureau, Current Population Survey Outgoing Rotation Group microdata (U.S. Census Bureau CPS-ORG). Various years. Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics [machine-readable microdata file]. Accessed November 2018 at https://thedataweb.rm.census.gov/ftp/cps_ftp.html.

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